Bipartisan Maryland leaders advocate for debt solution

John Fritze, The Baltimore Sun

They haven't solved the nation's fiscal crisis yet, but an advocacy group forming Monday in Maryland already has accomplished another political miracle: bringing together the operatives of Democratic Gov. Martin O'Malley and former Republican Gov. Robert L. Ehrlich Jr.

A bipartisan coalition of business leaders and high-profile political aides — including the former chiefs of staff to O'Malley and Ehrlich — are launching a state chapter of the national Campaign to Fix the Debt. The organization is pressing Congress to put party politics aside and quickly resolve spiraling budget deficits.

The Maryland chapter is forming as lawmakers in Congress face a deadline to address the "fiscal cliff," a combination of budget cuts and expiring tax breaks set to take effect automatically at the end of the year. Some economists say going over the cliff could trigger another recession.

"The clock is ticking here," said Michael Enright, a longtime friend and chief of staff to O'Malley who is now managing director of a private energy and infrastructure investment firm. "This has implications for every one of us."

Led at the national level by Alan Simpson, a former Republican senator from Wyoming, and Erskine Bowles, a White House chief of staff under President Bill Clinton, the Campaign to Fix the Debt draws heavily on widely respected — and, to date, widely ignored — recommendations from a commission chaired by the two men for how to cut federal deficits by more than $6 trillion over 10 years.

Republicans and Democrats in Washington have both touted the 2010 plan as a responsible framework to deal with annual deficits, which topped $1 trillion for the past four years. But significant cuts proposed to entitlement programs such as Social Security have given Democrats pause. Republicans generally dislike the fact that the plan calls for trillions of dollars in new tax revenue.

The Simpson-Bowles report assumes that the 2001 and 2003 income tax breaks on couples earning more than $250,000 will be eliminated at the end of the year. But in reality, those tax breaks are a big sticking point between the Republican-led House and the Obama administration.

The report also calls for proposals that would be difficult for Marylanders. For instance, it suggests continuing a pay freeze on federal employees and reducing the government's contribution to their retirement and health benefit plans. Nearly 300,000 federal workers live in the state.

Enright and former Ehrlich chief of staff James C. "Chip" DiPaula tread gingerly around portions of the plan that are uncomfortable for their respective parties. But both men quickly stress that whatever deal is worked out to address the fiscal cliff and long-term debt will necessarily involve some pain for both sides.

"We have serious problems that need to be addressed and that means everyone has to participate in the solution," DiPaula said. "We're trying to lend our voices, in our case on a state level, to ask our representatives to find a solution."

The national debt exceeded $16 trillion this year.

Other members of the group include Richard Cross, a former Ehrlich speechwriter; Michael Cryor, who led the state Democratic Party from 2007 to 2009; former Republican Maryland congressman Wayne T. Gilchrest; and former Baltimore County Executive Jim Smith, a Democrat.

The national group is running a multimillion-dollar ad campaign in Washington and other cities, but it is unlikely much of that advertising money will be spent in Maryland.

In 2002, Ehrlich was elected the state's first Republican governor in more than three decades. O'Malley unseated him four years later and won a rematch against Ehrlich in 2010.

Despite the rivalry, Enright and DiPaula said they have maintained respect for each other and an open dialogue. They traveled together on a cultural mission to Israel when O'Malley was Baltimore's mayor.

Enright also has a personal connection with Simpson. He took a class taught by the former Wyoming governor at the Kennedy School of Government at Harvard University in 1997 and the two have stayed in touch. Another leader of the national Campaign to Fix the Debt, Maya MacGuineas, was studying at Kennedy at the same time, Enright said.

"Addressing the federal debt and the looming fiscal cliff is the biggest challenge we face today," said MacGuineas, a respected budget expert in Washington, in a statement. "Lawmakers in Washington will need to make some tough decisions, and those will be easier if they know that the people they represent do indeed value cooperation and demand a long-term, comprehensive agreement over our debt."